I note that military officer students from a diverse range of
countries have joined the Australian contingent for this course, not
just from Australia's immediate neighbourhood but further afield
-

the UK, the United States, Germany, Fiji, Singapore, Thailand,
Papua New Guinea, Indonesia, Malaysia and New Zealand.

There is no better demonstration of the value of Australia's
people-to-people links with the region and the rest of the world than
your participation in the life and work of the college.

The Australian Government sees Australia in the 21st century as a
cooperative, economically competitive and secure nation, fully
engaged with the East Asian region, while maintaining and developing
links with countries beyond the region.

You will know from your studies that Australia's highest foreign
policy priority is closer engagement with the Asia Pacific region. It
is our highest priority for two simple reasons.

First, the Asia Pacific region is where Australia's best
opportunities for future jobs and prosperity lie.

But what is sometimes called an Asia first policy does not mean
Asia only.

On the contrary, the Australian Government understands - as do
other regional countries - that economic interests and our security
can be tied up with events well beyond our immediate region.

Today, I would like to set out the Government's key foreign policy
priorities and the steps we have taken to make these priorities a
reality in our foreign policy.

I will outline the four pillars of Australia's foreign policy.

They are:

a commitment to strengthening Australia's engagement
in the Asia Pacific region; a determination to enhance Australia's
security, especially in the context of developments in the Asia
Pacific;

an undertaking to strengthen Australia's broader,
global links in a more productive way; and

an insistence on a humane and principled approach to
regional and global challenges.

Papua New Guinea

But, before going into detail about the first foreign policy
pillar - Australia's strong commitment to the region - I would like
to say a few words about Papua New Guinea.

While working hard to achieve closer engagement with the entire
Asia Pacific region, we must never lose sight of those countries
which are our closest neighbours.

In the last two decades, Australian governments have focused -
rightly in my view - on East Asia.

But they have not always paid enough attention to Papua New
Guinea.

Not only was there a lack of real, sustained focus on PNG, but a
lack of continuous attention to the very difficult issue of
Bougainville.

During its first year in office, this Government has built up
close personal relationships with key PNG political figures

These contacts have proved invaluable in facilitating the
Government's dealings with PNG over the past month.

Recent developments have clearly demonstrated the consequences of
the lack of attention in the past.

I do not want to comment in detail on what has happened in PNG
over the past month or so.

Suffice to say the mercenaries have now left PNG; the
constitutional problems are being resolved; and we now look forward
to a stable and constructive election process.

The task for us now is to ensure that the Bougainville peace
process gets under way again.

Earlier this year, the PNG Government made considerable progress
in developing a peace strategy for Bougainville

The Government extended the mandate of the Bougainville
Transitional Government (BTG), initiated a new system of local
government based on a council of chiefs, and circulated a new
blue-print for a longer term peace strategy developed by the Minister
for Provincial Affairs, Peter Barter, and others.

The real challenge now is for both the PNG Government and the BRA
to demonstrate anew their willingness to work towards peace.

For its part, Australia will be making all possible efforts to
assist, where needed, in that process.

And, more generally, to redress the fact that not nearly enough
thought and attention has, in the past, been given to resolving the
Bougainville problem.

Part One: Australia's Commitment to the Region as
its Highest Foreign Policy Priority

Let me now turn to developments in the wider region, and
Australia's commitment to closer engagement with the Asia
Pacific.

An effective foreign policy depends in the first place on a clear
and far-sighted understanding of the trends shaping the world and its
regions.

In the case of the Asia Pacific, the fundamental reality is that
prosperity and security are increasingly intertwined, not just for
Australia but for every other country in our region.

That is why the recent dramatic changes in the economic landscape
of the Asia Pacific are the starting point for any cogent analysis of
what is happening in the region.

Economic Transformation

East Asia's sustained rapid growth has created a new sense of
common interest in stability.

The region's economic profile is almost unrecognisable when
compared with the mid-1970s.

The East Asian developing economies within APEC have grown by
almost 8 per cent annually since 1973.

In the process, the Korean economy has expanded in real terms more
than five-fold, and the Thai and Singapore economies more than
four-fold.

For its part, Australia is fully enmeshed in the region's economic
transformation.

Over half of Australia's total foreign direct investment goes to
APEC countries, and we earn three out of four of our export dollars
in APEC markets.

I am cautiously optimistic that regional growth will continue at
high rates at least until the year 2020.

By then, four of the world's ten largest economies will be in Asia
- Japan, China, Korea and India.

Indonesia will be near the top of the next ten, which will also
include Thailand and Australia.

These changes have raised important questions about the
sustainability of growth and political stability, as well as
resource, environmental, population growth and demography issues.

The sheer scale of growth in the region will continue to challenge
world markets to deliver the resources and capital needed to sustain
it.

For example, Asian demand for infrastructure capital could average
US$ 150 billion annually during the next decade, almost twice the
capital flows into Asia in peak years to date.

Economic growth is likely to be greatest in the region's major
cities, and this will place huge strains on basic services.

Australia is meeting these challenges by focusing - first of all -
on strengthening our bilateral relationships with key partners in the
region.

Bilateral Relations

Earlier this month in Perth, the Indonesian Foreign Minister, Ali
Alatas, and I signed an historic Maritime Boundaries Treaty which
concluded more than 25 years of negotiations between Australia and
Indonesia.

The result is that individuals and companies on both sides of the
boundary can proceed with maritime activities with certainty and
security.

More than that, at the Australia-Indonesia Ministerial Forum in
Jakarta last year, the Indonesian Minister of Production and
Distribution, Mr Hartarto, and I announced the Australia-Indonesia
Development Area - or AIDA.

We built on an important initial meeting with Dr Mahathir last
year by delivering a new Trade Agreement with Malaysia.

This Agreement will bring over time greater access for Australian
producers and benefits to Australian consumers.

In February this year, the Government achieved concrete results
from the inaugural Australia-Thailand Ministerial Economic Commission
meeting held in Canberra.

The meeting produced practical benefits for exporters and
consumers in both countries.

Mr Howard made his first bilateral visit as Prime Minister last
year - a very successful visit - to Indonesia and Japan, and he
participated in the equally successful APEC meeting in the
Philippines last November.

The commitment to working closely with our regional partners to
deliver practical outcomes is a pattern which has been repeated
throughout the Government.

My schedule, for example, took me to the Asia Pacific region as
part of each of my first eight trips representing the Government
abroad, including very productive visits to Thailand and
Singapore.

My first visit to Jakarta laid the basis for a genuinely close
relationship with Foreign Minister Alatas - a relationship bolstered
further by our most recent meeting in Perth.

Trade Liberalisation

The Government also gives substance to its commitment to engage
more closely with Asia through its determined pursuit of a trade
liberalisation agenda, most particularly through the APEC
process.

Last year the Australian Government - in cooperation with its APEC
partners - ensured that the task of implementing APEC's trade
liberalisation agenda got off to a positive start.

APEC economies have delivered a credible set of Individual Action
Plans (or IAPs) which set out initial road maps to the goal of free
and open trade and investment.

The Individual Action Plans reflect the strong existing momentum
of trade liberalisation in the region, but they also include new,
positive commitments.

The task before us now is to develop these initial efforts,
including by making further improvements to the IAPs in consultation
with business.

Our approach to trade and investment liberalisation through the
APEC process reflects our conviction that liberalisation is vital for
the region's - and Australia's - future.

It will enable more efficient exploitation of comparative
advantage in the region.

It will improve resource allocation and, most importantly, it will
improve the quality of life for millions of citizens throughout the
region.

The benefits of trade liberalisation are already manifest in the
Asia Pacific.

For example, over the last five years, Japan gradually has opened
certain sectors of its enormous market for food.

The importance of trade liberalisation extends well beyond East
Asia.

It is a key Australian objective for the new Indian Ocean Rim
Association for Regional Cooperation which was launched earlier this
month in Mauritius.

At the global level, the landmark World Trade Organisation
Ministerial Meeting in December 1996 paved the way for continued
global trade liberalisation.

Part Two: Working to Enhance Australia's Security

The second pillar of the Government's foreign policy has been the
steps it has taken to improve Australia's security and the strategic
environment in which we pursue our interests.

In that context, the economic transformation of the Asia Pacific I
mentioned a few minutes ago has been matched by equally profound
changes in the regional security environment.

The New Security Landscape in the Asia Pacific.

The post-Cold War era has brought challenges as well as
opportunities. The regional security environment is now more fluid,
complex and uncertain.

In North East Asia, for example, it would have been very difficult
during the Cold War to imagine the rapidly developing relationship we
now see between China and South Korea.

Issues such as the competing claims and interests over the South
China Sea, the Korean peninsula and the Taiwan strait are all
manageable, but they nevertheless pose challenges for the region, as
does the proliferation of weapons of mass destruction.

Beyond these core concerns, a range of other security issues has
added extra layers of complexity to the regional security
environment.

The region has to come to grips with problems such as
international terrorism, drug trafficking and international
crime.

The region's new fluidity and complexity require the further
development of its security architecture.

A fundamental consideration for the Asia Pacific's security
outlook will be the evolution of relationships between the region's
major powers: the United States, China, Japan, Russia and, in the
longer term, India.

As Henry Kissinger has noted, the emergence on the world scene of
a new power like China always requires a period of adjustment.

Consideration must also be given to the legitimate claims of the
middle-sized regional powers who will want a bigger say in managing
the strategic affairs of the region.

Designing a New Security Architecture

Clearly, the answer to the new security challenges I have outlined
lies - as it does with the economic changes throughout the region -
in building and deepening cooperative linkages.

You cannot just put up the shutters and hope the difficult issues
will go away.

The future shape of the Asia Pacific's security architecture is
not yet settled, but it is possible to see a pattern emerging.

While it might not often be said publicly by countries in the
region, there is, I think, widespread support for continuing United
States strategic engagement in the Asia Pacific.

The United States has a vital role in helping to stabilise
regional security. Its presence strengthens regional countries'
confidence in their security - in effect helping to minimise
tensions.

This is most obvious in North East Asia where, for example, Japan
and South Korea have not only refrained from acquiring nuclear
weapons but have also undertaken legal obligations never to acquire
them.

So it is clear that the United States' continued strategic
presence is an important element in the region's emerging security
pattern.

That pattern combines bilateral, sub-regional and region-wide
linkages - some formal, some informal - in a growing web of
relationships in the region.

Australia has a crucial place in that web.

All the linkages contribute to what I see as the core goal of
Australia's regional policies - building a sense of trust, a sense of
common interests and of shared responsibility for the region's
future.

Australia's Vital Contribution to a More Secure Region

The Government has specifically set out to help in the development
of a regional security environment which:

forestalls resort to force in international
disputes;

prevents proliferation of weapons of mass destruction;
and

encourages cooperation to enhance the security of the
region as a whole.

Bilateral and Sub-Regional

At the bilateral level, there is growing acceptance that strong,
confident relationships provide the underpinning for regional
stability and effective multilateral activity.

Australia has been extending its linkages throughout the Asia
Pacific under the rubric of "practical bilateralism".

We make practical contributions to the region's security through
our formal security arrangements with Indonesia, Papua New Guinea and
New Zealand.

The Government sees its alliance with the United States in the
same light.

Australia and the US gave new vigour to the ANZUS alliance through
the Joint Declaration on Security which was announced during the
Australia-US Ministerial Talks in July last year.

In addition to these linkages based on formal arrangements,
Australia has a range of other strong and growing bilateral defence
and security ties with South East Asian countries.

Australia is also strengthening its bilateral security links with
North East Asian countries.

The Australian Government held inaugural political-military talks
with South Korea in July last year and, earlier in 1996, we held
inaugural pol-mil talks with Japan.

In August, we also reached agreement on official discussions with
China on regional security.

Of course, the bilateral relationships that contribute most to
shaping the regional environment are those between the major
powers.

Australia welcomed the Joint Declaration signed by President
Clinton and Japanese Prime Minister Hashimoto in April last year.

It is equally important to look beyond traditional alliance
relationships, and support the strengthening of other key bilateral
ties, for example between the United States and China.

Because, in the end, integration of all regional countries in a
shared security system is the best assurance of regional
stability.

Let me digress briefly to try to bury the fruitless argument about
whether the world should contain or engage China.

The overwhelming fact is that China is already deeply engaged with
the rest of the world, and its engagement is accelerating.

Australia welcomes that process unequivocally.

China is firmly integrated into the regional and global
economy

Twenty years ago it ranked below 30 among the world's exporters.
Now it is up in the top ten and climbing fast.

It is contributing strongly to regional growth - and benefiting us
all.

China is also playing a more active and constructive role in
international forums.

Ten years ago, for instance, nobody would have foreseen China
voting for a Comprehensive Test Ban Treaty, as it did in September
1996.

China is active in APEC and the ASEAN Regional Forum.

Only a few weeks ago, Beijing successfully co-hosted the first
official multilateral security meeting ever held in China - the ARF
inter-sessional group on confidence-building measures.

At the sub-regional level, the Five Powers Defence Arrangement -
which joins Australia and the United Kingdom with Singapore, New
Zealand and Malaysia - provides for close cooperation.

Regional

At the regional level, the three year old ASEAN Regional Forum, or
ARF - the process which brings together major East Asia/Pacific
countries for security dialogue and cooperation - is characterised by
minimal institutionalisation and consensus decision-making.

It has an evolutionary approach to objectives and the use of
second track diplomacy.

Observers brought up in the tradition of European statecraft
sometimes question the value of the ARF because it is not itself able
at this stage to resolve conflicts and regulate security affairs.

It must be remembered, however, that unlike Europe, the Asia
Pacific has no tradition of inclusive multilateral approaches to
security or defence.

It will take time to build trust and confidence between those ARF
countries which have no tradition of discussing security concerns and
approaches to national security.

Australia is working with its partners in the region to ensure
that the ARF develops as a key regional process for promoting peace
and stability in the East Asia/Pacific region.

The ARF has already made good progress on the first phase of its
activities, confidence building.

Exchanges of security perceptions are becoming more frank, and are
contributing to better understanding.

The circulation of defence policy statements is contributing to
transparency.

Preventive diplomacy - the second stage of the ARF's activities -
is already showing good potential.

At the third ARF meeting in July last year, for example, the
Indonesian Foreign Minister, Ali Alatas, used his good offices as
chairman to convey ARF members' concerns about the situation in Burma
to the Burmese Foreign Minister.

I am proud to say that Australia played an instrumental role in
this initiative.

Building on this, the Government is keen to see the ARF make an
early start on dispute management.

Success with the ARF's confidence-building and preventive
diplomacy stages may lead in future to a third stage - the resolution
of conflict through agreed mechanisms.

How and when that could happen is not yet clear, as sensitivities
remain at this stage.

Multilateral

At the multilateral level, the Australian Government takes a
strong interest in security issues beyond its own region, in
particular global arms control and disarmament regimes.

I want to emphasise that the Government's multilateral diplomacy
is vital to the promotion and protection of Australia's security
interests because - above all - it reinforces all that we do at the
regional and bilateral levels.

Australia's historic initiative to secure the adoption of the CTBT
last year allowed for a genuine step forward in the non-proliferation
and disarmament agenda.

That is something of which the Australian Government is
justifiably proud.

Australia is also strongly committed to working to rid the world
of anti-personnel landmines.

These weapons have been so widely misused in a way they were never
intended to be that Australia - like many other principled, concerned
countries - believes the sane, humane course is to ban them
completely.

The Australian Government's decision in April last year to suspend
operational use of anti-personnel landmines by the Australian Defence
Force and to support a global ban on the production, stockpiling, use
and transfer of anti-personnel landmines was a clear indication of
our determination to work for the elimination of these weapons.

In my address to the Conference on Disarmament in Geneva earlier
this year, I called on states to conclude a legally-binding
international regime which effectively outlaws anti-personnel
landmines as a weapon of war and civilian terror.

The Inter-Relationship Between Australia's Foreign and Defence
Policies

Australia's principled and practical stand on landmines is just
one example of how our foreign and defence policies work together in
the national interest.

I want to take a few minutes to speak more broadly about the
inter-relationship between Australia's foreign, security and defence
policies.

Clearly, enhancing and protecting Australia's security is a much
more challenging task in the post-Cold War world.

I have already spoken about several of the new challenges facing
the region. But these challenges are not confined to the Asia
Pacific.

New non-military threats to security are a global reality - for
example, the clandestine arms trade, the narcotics trade, pressures
arising from the growth of the world's population, and related major
threats to the environment.

The elemental characteristics of such non-military threats to
security are that they cannot be defeated by weapons - they cross
state boundaries and they can affect whole populations.

One important consequence for Australia is that our foreign,
security, defence, economic and trade policies are more inter-related
than ever before.

That is why the Government has worked hard to ensure that its
policies across the board are well coordinated and implemented.

When the Government came into office, we established the national
security committee of cabinet as a focal point for security policy
coordination and decision-making.

It has functioned well over the past twelve months.

In particular, the Government has ensured that our foreign,
security and defence policies work together in support of better
bilateral, regional, sub-regional and multilateral links.

Our defence policy - and defence relationships - play an important
role in the achievement of our foreign policy goals.

For example, the ADF continues to contribute a great deal to
Australia's closer engagement with the region.

The ADF maintains an important network of people-to-people links
and contacts which have contributed to the strengthening of ties in a
range of Australia's most important bilateral relationships.

These contacts also help build the sort of transparency and mutual
trust which Australia is seeking to promote in regional forums such
as the ARF.

The impressive way in which this course brings together students
and officers from all over the world is another very practical and
worthwhile example of how foreign and defence policy can work
together constructively in support of national objectives.

Part Three: Strengthening Australia's Broader Global
Links

The third pillar of the Government's foreign policy is the
enhancement of Australia's broader global links.

The Government regards our links with other countries beyond the
region as important and appreciating assets.

One striking example has been the Government's successful effort
to improve and expand Australia's ties with Europe.

My trip to Europe earlier this year has resulted in strengthened
relations between Australia and key partner countries within the
European Union.

My visit to Italy - the first by an Australian Foreign Minister in
nearly a decade - has helped revitalise the bilateral political and
commercial relationship between Italy and Australia.

We have made the bilateral relationship with the United Kingdom
even stronger.

In February - with UK Foreign Secretary Rifkind - I launched a
major bilateral trade and cultural promotion called "New Images" on
an Australian-built fast ferry in the Thames.

Beyond Europe, the Government held the inaugural meeting between
Australia and the Rio Group countries of South America in 1996 as a
preparatory step to closer trade, aviation and communications links
between the two continents.

Part Four: Australia's Humane and Principled Foreign
Policy

The fourth and final pillar of Australia's foreign policy is a
focus on a humane and principled foreign policy.

Australian foreign policy is vitally concerned with upholding
internationally recognised standards of human rights and looking for
practical ways to enhance individual dignity and freedom and promote
democracy internationally.

This is a key element of Australia's foreign policy and a long
standing part of Australia's rich history - the shared values that
bind us together as a nation.

This area of policy involves two major elements: public diplomacy
and constructive initiatives.

With regard to the first area of public human rights diplomacy,
Australia has continued to make strong representations to the
Government of Burma on specific human rights cases and is maintaining
regular contact with opposition spokespeople, including Daw Aung San
Suu Kyi.

By way of practical initiatives in other areas, the Government has
already given a contribution of $300,000 for the International
Committee of the Red Cross to continue its human rights monitoring
work in East Timor.

In looking to the future, the Australian Government is involved in
three initiatives which will make practical, long term contributions
to human rights and democracy at a structural level.

First, the Australian Government is supporting the development of
Asia-Pacific human rights arrangements.

This is important because the establishment of a human rights
framework and institutional infrastructure will bring our region into
line with Europe, the Americas and Africa.

The second Government initiative is the proposal to establish a
new Centre for Democratic Institutions which will focus on the
promotion of democracy and democratic change internationally.

A third initiative to which I have lent my strong personal backing
is the establishment of an International Criminal Court.

An International Criminal Court would be an important step forward
for the international community in dealing with the most serious
crimes of international concern such as genocide, war crimes, and
crimes against humanity.

Conclusion - Looking Ahead

In conclusion, everything I have said today shows that the
Government has established clear and realistic priorities in its
foreign policy, founded securely in Australia's national
interests.

More than that, it has taken significant steps to implement those
priorities.

I have outlined for you the real achievements in the areas of
regional engagement, security policy, global engagement and human
rights which set the tone for the future.

We have paid particular attention to bilateral relations because
we take the view that multilateral institutions - whether regional or
global - will always be far more effective if the countries within
them have confident, strong bilateral ties.

The task ahead is equally clear - to follow up on these policy
directions, and to shape Australia's foreign policy in the long term.
The Government is doing exactly that.

The people-to-people links that I spoke of at the beginning of my
address are very important in the strengthening of cooperative ties.
I cannot stress that point too much.

In that sense, you should see your participation in the College as
part - an indispensable part - of the larger pattern emerging in the
region and beyond.

You embody the philosophy of regional cooperation, transparency
and mutual understanding.

I urge you to make the most of the personal and professional
opportunities that this course provides.

To those officers from abroad participating in this course - I
hope that your studies give you not only a good understanding of
Australia's defence and strategic outlook but a broader appreciation
of Australian society and its values of tolerance, respect for human
dignity and democracy.

I trust that, after you leave Australia, you will continue to be
vigorous ambassadors for the spirit and practice of regional and
global cooperation.